Thesis Defense Presentation: Feyza G. Sahinyazan
Ms. Feyza G. Sahinyazan a doctoral student at McGill University in the CREATE option will be presenting her thesis defense entitled:
FOOD AID LOGISTICS IN RESOURCE-CONSTRAINED ENVIRONMENTS
Date: Tuesday, August 28, 2018
Time: 2:30 pm
Location: Room 575, Bronfman Building
All are cordially invited to attend the presentation.
Student Committee Chair: Professor Vedat Verter
Abstract
This thesis focuses on the logistical challenges that the humanitarian agencies face while delivering food aid to regions suffering chronic hunger. Although the problems described in the thesis are common among the humanitarian organizations and the outcomes are transferable to other settings, they are inspired by the world’s largest humanitarian organization fighting against hunger: United Nations’ World Food Programme (WFP). This thesis consists of three research projects. In the first project, I conducted a field research in WFP Kenya headquarters in order to understand the major challenges that WFP faces in the transportation domain. I have visited critical points in the WFP’s food aid supply chain, conducted interviews with WFP officers and the third-party transporters contracted for food aid delivery. These interviews revealed that the WFP is facing considerable challenges with the transporters. First, WFP signs contracts with transporters that provide the lowest bid for a six-month period. This mechanism enables WFP to decrease its logistics costs, however, the contracted rates usually fall below the average market rates. In addition, the transportation cost fluctuations due to oil price changes are not reflected in the contracts. Second, the transporters usually turn down the requests from WFP for better paying opportunities since there are neither penalty nor bonus clauses in WFP contracts. Third, there is a significant variance among the rates for different origin-destination pairs as well as different contracts. To address these challenges, in my second project, I develop a framework that calculates contract rates reflecting the market dynamics and provides the necessary adjustments in the contracts, so that the transporters respond WFP’s cargo requests on time. Using the market rate data gathered from the Kenyan transporters, I build an econometric model that captures the variation in transport market prices. In addition, I devise a new barrier-type option contract that can increase the transporters’ service levels by updating the rates according to the oil price fluctuations during the course of the contract. The numerical experiments on real-life data demonstrate that significant improvements in service levels without incurring additional costs to WFP can be achieved for certain origin-destination pairs that are not desirable for the transporters. In the third project, I explore a more radical solution to the excessive logistics costs and related operational challenges: providing cash and vouchers instead of physical food distribution. Recently, many humanitarian organizations ran pilot studies on these newer aid modalities. Empirical evidence emanated from these studies shows that implementing cash and voucher programs can improve three main objectives: the logistics costs, the nutritional outcomes, and the contribution to the local economy. I develop a generic model that selects the aid modalities by measuring the improvements in these three program objectives. In addition, I incorporate the consumption behaviour of the beneficiaries in a bilevel optimization model structure to capture their cash spending preferences. Finally, I show how this model can be used for aid program design and policy evaluation purposes by using a real-data set for Garissa county of Kenya
